Are you trying to figure out what info to include? Read this article to learn the answer to, “What does a pay stub look like?”
Let’s be honest, most employees care about one thing on payday, how much money did they get paid. In many cases, employers directly deposit funds into the employee’s account.
But have you ever stopped to take a look at your paystub? Does your employer provide you with one? Have you wondered why they give you one even though you already have the pay in your account?
What does a pay stub look like?
Understanding how to read your pay stub is pretty important for employees and it helps create important documentation for employers.
Read on to learn all about the pay stub, how to read it, and what should be included on it.
Why Is the Pay Stub Important?
The pay stub is important to both employers and employees for a few reasons.
Employers use the free pay stub generator to create a pay stub for their employees for a few reasons. It creates a system of documentation for them. They keep up their employee payroll records.
If there ever is a dispute between an employer and employee, they have the records to show what they paid and what they deducted from the pay and why.
Employees can use the pay stub to verify their hours, make sure deductions are accurate. They can also use it as employment verification if they are buying or renting a house, buying a car or even applying for another loan.
Pay Stub Requirements
Many employers provide pay stubs no matter the state requirements. It’s just smart business for them. Yet, you should know the requirements vary from state to state whether it’s required to provide a pay stub to employees.
There are several states that have no requirements. these states include:
- Alabama
- Arkansas
- Florida
- Georgia
- Louisiana
- Mississippi
- Ohio
- South Dakota
- Tennessee
There are 26 states across the US that do require paystubs to be provided in some format. The state laws vary slightly. But the pay stub could be in written form, printed or in a digital format.
Eleven states across the US require employers to provide a pay stub in written or printed form, not digital. In Delaware, Minnesota, and Oregon, you must tell your employer if you want to opt from a digital format to a paper format.
Hawaii is the lone unique state that requires employees to opt to go to digital from a paper format.
What Should Employees See on a Pay Stub?
There are several different areas of the pay stub that provide you as employee information. Some are about wages and others about deductions and contributions. Let’s take a closer look.
Employee and Employer Information
The pay stub will always have a section with information about both the employer and the employee. The employer’s name, address, and contact information will be listed. Usually, this is the location where the employee works.
If the company is large, there might be contact information for the human resources department at a different location.
The employee name, address, and employee ID will also be on the check. Rarely, do employers use the social security number on checks anymore.
Often the pay period dates are also included here to indicate the dates which the employee is being paid for.
Gross Pay
Gross pay is the amount being paid to the employee before any deductions.
If you are a salaried employee, the gross pay is how much you make a year, divided by the number of times you’re paid over the course of a year.
If you are an hourly employee, the gross pay is your hourly rate multiplied by the number of hours you worked during the pay period.
Gross might also include commissions, bonuses, or paid time off.
Deductions
Deductions will include any of the money taken out by your employer. This will include social security and FICA. You also have to decide your dependents and state and federal taxes are removed based on that number.
Whatever state and local taxes are required of you will be deducted here.
Many employees pay for part or all of the health insurance. If you pay towards health insurance, it would show up here.
If you pay into a 401K or other pension program and money is taken from your pay, it would also show up as a deduction.
In some states, if you are part of a union, they will deduct union dues from your pay too.
Some employers allow you to make charitable donations from your pay. This would also show under deductions.
Some employees also have wage garnishments for things like child support deducted right from their pay.
Contributions
If your employer pays into a pension plan or retirement plan for you the contributions are listed here.
Maybe you pay into a company 401k plan and the company does matching funds. Your part will show up under deductions, while the employers’ matching funds show up as a contribution.
Net Pay
The net pay is usually the box that employees look to first when they open a pay stub. This box shows how much you are actually getting for pay.
The net pay should equal all your gross minus all the deductions that were removed from your pay.
Understanding What Does a Pay Stub Look Like
What does a pay stub look like?
The next time it’s payday, take the time to take a look at your pay stub. Now you’ll know exactly how to read it and understand all the boxes and numbers.
You might even look beyond that net income box telling you how much you made.
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